OFB, Bharat Forge, Reliance in the fray for initial Air Force contract; have tied up with global partners

Indian companies bidding for an order for new air defence guns for the air force valued at over Rs 15,000 crore have put their best foot forward as the larger picture shows that orders worth Rs 40,000 crore are at stake for similar requirements of the Army and Navy.

At least five Indian companies, including Bharat Forge, Reliance, Tata and L&T are in the fray for the contract by the air force to purchase new age close in weapon systems for protection of airfields and other key assets. The state run Ordnance Factory Board (OFB) has also put in a bid.

While the air force is looking to buy 61 flights of the systems, only 18 of which can be delivered directly from a foreign partner, the air defence programs of the Army and Navy are even bigger in value. The combined value is expected to be in excess of Rs 40,000 crore, given that air defence guns have not been bought for over three decades.

The program suffered a hit after Defence firm Rhienmetall was banned in 2012 on alleged corrupt practices. The German company had an air defence gun that was the only one of its kind in the world that met requirements drawn up by Indian armed forces.

With the company banned, alternate choices were not available despite several attempts by the armed forces. The air force has since downgraded the technical requirements – specially the firing rate – to ensure a competitive process. Similar tenders by the air force and Navy are expected in the coming months.

These systems are capable of taking down drones, small aircraft and incoming missiles. Indian companies have tied with up foreign partners for the bid, with three frontrunners that include Bharat Forge that has a tie up with BAE systems, Reliance that has a partnership with Hanwha and Thales and the OFB which has an in house deal with Bharat Electronics Limited (BEL).

Foreign collaborators of L&T and Tata have not yet been disclosed. The contract requires that at least 40 percent of the content must be indigenized and that Indian companies be the lead bidder for the contest. It will however take at least three years before a contract can be signed as the next steps include field trial and evaluations.

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